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TMI Blog2021 (3) TMI 486X X X X Extracts X X X X X X X X Extracts X X X X ..... ls much after the Notification in G.O.Ms.No.119 dated 13.4.1994. What is interesting to note is that in G.O.Ms.No.119 dated 13.4.1994, a specific direction was issued to the State Government and the District Industries Centre to work out BPV and BSV and incorporate the same in the eligibility certificate at the time of issuance by the SIPCOT and the District Industries Centre. The wordings in paragraph 3(v) of the Government Order in G.O.Ms.No. 119 dated 13.4.1994 were that the BPV and the BSV would have to be worked out and incorporated in the eligibility certificates at the time of issue by the SIPCOT and the District Industries Centre. If such is the position and the date of eligibility certificate of the petitioner being 17.6.1993, G.O.Ms.No.119 dated 13.4.1994 could not have been applied to the petitioner. Therefore, even though the rescheduled period was from 01.12.1994 to 30.11.1999, the eligibility for the deferral scheme would date back to the date of the original eligibility certificate dated 17.6.1993, as in that certificate, conditions have been imposed and the reschedulement dated 31.1.1995 was only reschedulement of dates and nothing else - the respondent Departm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x (IFST) deferral loan of ₹ 70,31,851/- and repaid the same belatedly. In spite of an elaborate reply/objections dated 06.5.2002, filed by the petitioner, the Assessing Officer did not agree with the stand taken by the petitioner and accordingly rejected the objections and confirmed the proposal. The first respondent issued the proceedings dated 21.6.2002 demanding interest under Section 24(3) of the Act. 4. Aggrieved by that, the petitioner was before the Tribunal seeking to quash the order dated 21.6.2002 by filing O.P.Nos.682 to 684 of 2002 and to direct the Assessing Officer to follow the conditions in the Notification issued by the Government in G.O.Ms.No.500 Industries (MIG II) Department dated 14.5.1990, which announced incentive scheme for industries and more particularly the IFST deferral scheme. However, the Tribunal, by the common impugned order dated 23.10.2002, dismissed the said petitions. Aggrieved by the same, the petitioner is before us by way of these three writ petitions. 5. The short issue, which falls for consideration, is as to whether the Notification issued in G.O.Ms.No.119 Commercial Taxes and Religious Endowments Department dated 13.4.1994, whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rcial production i.e. from 01.10.1991 to 30.9.1996. 8. The said eligibility certificate dated 17.6.1993 also contained the condition that the sales tax deferral benefit was subject to the sales tax payable on products manufactured by the capacity created by expansion scheme at Melakandamangalam village, Aruppukottai Taluk, that the petitioner should continue to pay tax at the level it was paying to the Commercial Tax Department prior to taking up this expansion and that only the incremental sales tax liability that would arise due to the additional production out of the envisaged expansion scheme had to be allowed for the deferment facility. 9. Since the petitioner commenced commercial production on 01.10.1991 and though they applied for the eligibility certificate immediately and the same having been granted only on 17.6.1993, they submitted a representation for rescheduling the period of deferral. In the meantime, an inspection was conducted in the business premises of the petitioner on 17.1.2002 and the need for inspection was stated to be for verification of the correctness of the accounts. Pursuant to the said inspection, a proposal was given by the Deputy Commerci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... led to succeed. We may also make it clear that G.O.Ms.No.119 CT RE Department dated 13.4.1994 is prospective and such of the expansion units or diversified units, which are set up after 13.4.1994 will only be governed by G.O.Ms.No.119 dated 13.4.1994. As the expansion unit involved in this writ appeal had come into existence long before 13.4.1994, it will not be governed by G.O.Ms.No.119 dated 13.4.1994 and as such, its sales tax liability has to be determined without reference to the said Government Order and only as per G.O. Ms.No.500 dated 14.5.1990. Accordingly, the writ appeal is allowed and the order of the learned Single Judge is set aside. The demand made by the first respondent is quashed. The respondents are directed to determine the tax liability of the petitioner appellant in respect of the expansion unit without reference to the existing unit. 14. In terms of the above decision, G.O.Ms.No.119 dated 13.4.1994 can have only prospective application. In G.O.Ms.No.119 dated 13.4.1994, for the first time the Government imposed a condition for eligibility to avail deferral sales tax and this was termed as Base Production Volume (BPV) and Base Sales Volume (BSV) and i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also take note of the decision of this Court in the case of M/s.Sulochana Cotton Spinning Mills (P) Ltd. Vs. State of Tamil Nadu [reported in (1995) 98 STC 125] wherein the Hon'ble First Bench of this Court framed three questions for consideration, the first of which was with regard to scope and ambit of G.O.Ms.No.500 dated 14.5.1990 and the second question was as to what was the effect of another Government Order in G.O.Ms.No.92 dated 22.2.1991 on G.O.Ms.No.500 dated 14.5.1990, as G.O.Ms.No.92 dated 22.2.1991 brought in certain conditions. The Hon'ble First Bench of this Court, after explaining the scope and ambit of G.O.Ms.No.500 dated 14.5.1990, while answering the second question, held that G.O.Ms.No. 92 dated 22.2.1991 would have only prospective effect. The reasons assigned by the Hon'ble First Bench of this Court in the said judgment would fully apply to the facts of this case. 20. As pointed out by Mr.N.Inbarajan, learned counsel for the petitioner, the respondent Department does not dispute the fact that the Inspecting Officer gave a clean chit to the petitioner and in no uncertain terms stated that the IFST deferral availed by the petitioner in &# ..... X X X X Extracts X X X X X X X X Extracts X X X X
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